A Snapshot Of Growth vs. Value Investing (Small-Caps)

Bob Carey
Chief Market Strategist

Bio
X • LinkedIn

Blog Home

Send Us Your Comments And Questions

RSS Feed

A Snapshot Of Growth vs. Value Investing (Small-Caps)

Posted Under: Themes

View from the Observation Deck

We update this post on small-cap stocks every now and then so that investors can see which of the two styles (growth or value) are delivering the better results.
The S&P SmallCap 600 Pure Growth Index closed at 15,421.35 on 1/29/21. It stood 3.57% below its all-time closing high, according to Bloomberg. The S&P SmallCap 600 Pure Value Index closed at 7,008.83 on 1/29/21. It stood 6.71% below its all-time closing high.
The S&P SmallCap 600 Pure Growth Index outperformed its value counterpart in all six periods featured in the chart.
The returns through 1/29/21 were as follows (Pure Growth vs. Pure Value): 15-year average annualized (10.19% vs. 5.59%); 10-year average annualized (13.22% vs. 7.59%); 5-year average annualized (16.40% vs. 8.59%); 3-year average annualized (9.82% vs. 0.29%); 1-year (32.74% vs. 19.42%) and year-to-date (9.73% vs. 5.99%).
As of 1/29/21, the largest sector weighting in the S&P Small-Cap 600 Pure Growth Index was Health Care at 23.4%, according to S&P Dow Jones Indices. The largest sector in the S&P SmallCap 600 Pure Value Index was Financials at 19.7%.
As of 12/31/20, the amount of assets held by Small Blend, Small Growth and Small Value mutual funds and exchange-traded funds totaled $471 billion, $312 billion and $167 billion, respectively, according to Morningstar.

This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions or other expenses incurred when investing. Investors cannot invest directly in an index. The S&P SmallCap 600 Index is an unmanaged index of 600 stocks used to measure small-cap U.S. stock market performance. The S&P SmallCap 600 Pure Growth Index is a style-concentrated index designed to track the performance of stocks that exhibit the strongest growth characteristics based on three factors: sales growth, the ratio of earnings-change to price, and momentum. It includes only those components of the parent index that exhibit strong growth characteristics, and weights them by growth score. Constituents are drawn from the S&P SmallCap 600 Index. The S&P SmallCap 600 Pure Value Index is a style-concentrated index designed to track the performance of stocks that exhibit the strongest value characteristics based on three factors: the ratios of book value, earnings, and sales to price. It includes only those components of the parent index that exhibit strong value characteristics, and weights them by value score.

Download a PDF of this post, please click here.

Posted on Tuesday, February 9, 2021 @ 2:15 PM • Post Link

Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

Most Current Posts

<<< Newer Posts • Older Posts >>>

Search Posts

MARKET ANALYSIS

Market Commentary and Analysis
•	Market Commentary Video
•	Monthly Talking Points
•	Quarterly Newsletter
•	Market Observations

Subscribe To Receive Email

PREVIOUS POSTS
•	Assets Held By Equity ETFs And Equity Mutual Funds Have Surged
•	The Great Rotation Out Of Bond Mutual Funds Never Happened
•	A Snapshot Of Stock Performance Relative To Historical U.S. Inflation Rates
•	The Tech Sector Has Been The “Gold Standard” For 15 Years
•	Passive vs. Active Fund Flows
•	One Measure Of Corporate Cash Holdings
•	Every Year Looks Volatile Compared To 2017
•	A Snapshot Of Bond Valuations
•	A Snapshot Of How Stocks Have Performed So Far In This Millennium
•	The Only Constant Is Change